Car insurance and property damage

It is easy to think about car insurance only in relation to motorway pile ups or collisions on roundabouts. However, there are many other ways in which a vehicle can cause other kinds of injury or loss to other people, including homeowners. While an injured party could be a pedestrian or another vehicle owner, it could just as easily be a property owner.

In Lyons Davidson’s Property Insurance Litigation group, we come across many situations where your car insurance may cover you if your vehicle is involved in such an incident but also where your home insurers can look to vehicle insurers for the cost of building repairs. We wanted to share some of the most common scenarios with you.

Our group routinely handles claims for property damage caused by vehicles. The buildings or contents insurer will pay out to repair this damage and then look to recover the cost from the negligent driver. The special expertise of the Property Insurance Litigation Group at Lyons Davidson is in assessing liability and then pursuing the liable party (or parties) on behalf of the property insurer.

We use a whole range of tools to help us do this where vehicles are involved, including the following:

MID checks: we use askMID to search the Motor Insurance Database, known as MID. This is the central record of all insured vehicles in the UK and is used by both the police and the DVLA to enforce motor insurance law, which means it is reliable and provides us with crucial information;

DVLA requests: although most of correspondence will be with the third party’s car insurance company, it is important to send our letter of claim to the defendant directly, in order to comply with relevant pre-action protocol. DVLA searches are great for obtaining the guilty party’s address, ensuring that we send our letter of claim correctly, which starts the recovery process;

Police reports: not only can we request a copy of the police collision report, we can also ask them to search their records for reports of incidents they may have attended using a 518A form. This may provide the names of any people involved in the incident or, in this scenario, it could highlight the company responsible for the vehicle. Alternatively, we might request the full police report to help with our enquiries. This report would provide the vehicle registration number, if this was not already known or provided by any witnesses, and if the vehicle drove away after the damage had happened. This is also likely to tell us whether the vehicle was stolen and if it was carrying any passengers who would also be witnesses to the event;

Trace agents: these agents are not only able trace the location of a defendant but can also give details of their financial means to pay our client’s claim.

Here are some different scenarios based on actual cases, which are not typical vehicle-on-vehicle collisions but where the damage would still be covered by your car insurance:

Case Study 1: A commercial vehicle owned by Food Deliveries R Us is making a delivery to the claimant’s home on behalf of a large supermarket chain. It is driven by Food Deliveries R Us employee, Bob. Unfortunately, Bob is distracted and looking at his mobile phone and puts the vehicle into reverse instead of first gear. It hits the boundary wall and the front steps, causing damage. The claimant saw the whole thing.

Evidence checklist:

A search of the askMID database to establish the insurers of the vehicle;

CCTV footage showing the incident and photographic evidence of the damage;

The police collision report;

The claimant’s witness statement.

Both Food Deliveries R US and their driver are potentially liable in this situation. Bob is liable for negligent driving. However, because his negligence occurred during the course of his employment, Deliveries R Us will also be vicariously liable for his actions. The doctrine of vicarious liability imposes strict liability on Deliveries R Us for Bob’s wrongdoing, as long as it happened during the course of his employment with them. Their liability is called ’strict’,” because they will be liable even though they are not guilty of any wrongdoing themselves. So, Deliveries R Us will automatically be ultimately responsible if we can prove that the impact occurred in the course of Bob’s employment.

Pursuing a successful recovery is the same whether a vehicle crashes into a commercial property or a residential property. Our main objective is to shorten the life cycle of any claim. This keeps costs down and causes as little inconvenience to our clients and their policy holders as possible, while still securing a successful recovery of insurers’ outlay.

In this scenario, for a prompt and amicable settlement, we would prefer to pursue the employer’s public liability insurers. However, if, for any reason, they declined to deal with the claim, it is equally possible to recover the cost of repairs from Bob’s own motor insurers – even if Bob is not covered for driving commercial vehicles in the course of his employment. The reason for this will become clear in the next scenario.

Case Study 2: Anneliese and her friend Bridget have six Jaegerbombs apiece before Anneliese hands Bridget her car keys to drive them home. Bridget – predictably – crashes Anneliese’s vehicle into a commercial property. They flee the scene of the incident.

Both Anneliese and Bridget are liable here. The former has willingly and knowingly passed control of her vehicle to a person unfit to drive. The latter was driving under the influence, which is clearly negligent.

To bring an action against the two defendants, we will do an MID check to identify the insurer of the vehicle and request a DVLA registered keeper check if ownership of the vehicle is in dispute. A police collision report will be useful as evidence against either defendant, although sometimes this may not reveal their addresses. If necessary, we will also instruct a trace agent to locate the defendants and assess their financial means. If the MID result revealed that the vehicle was uninsured, we would be particularly interested in the defendant’s ability to pay the claim themselves.

It is a little known fact that your car insurance can cover losses caused by others driving the vehicle, even if they are not named in the policy or authorised to drive. Your car insurance may even cover losses caused by the negligent driving of a thief, if your car was stolen. Bridget does not own the vehicle and was not insured to drive the vehicle under the policy. However, under s.151 of the Road Traffic Act 1991, the insurers of Anneliese’s vehicle may be obliged to pay for the cost of damage caused by Bridget’s negligent driving of that vehicle, even so.

We would have to issue and serve proceedings on Bridget the cost of the damage, seek judgment and then present this to Anneliese’s vehicle insurer, once Bridget has failed to pay it. Provided that they are on notice of our intentions, they will be obliged to pay the damages. It is then up to Anneliese’s insurers to decide whether they pursue that judgment against Bridget directly to recover that cost or against Anneliese for breaching the terms of her car insurance cover. If Bridget had stolen the keys from Anneliese, we would still seek recovery under s.151 of the Road Traffic Act 1991 and Bridget could be looking at another law suit in due course.

So what can you do?

Incidents like these seem complicated and the aftermath is certainly messy, but there is nearly always a way through. Motorists need to be aware that their liability when driving extends beyond the kerb and not just to people and cars but to building owners too. For those building owners, the key, if a vehicle collides with your property, is to gather as much information as possible and to notify your buildings insurers quickly: the road to recovery might be shorter than it first appears.

For more information on any of the issues raised in this article or on property damage matters in general, contact our Property Insurance Litigation team or call 0117 904 6000.

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